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Microsoft’s Change From Premier to Unified Support May Cost Organizations Up to 30% More

Microsoft has made a transformational change to its Premier Support model, which is currently a 3.3 billion dollar revenue source for them. Premier Support historically has been based on a dollar rate per hour of support model and now will be based upon percentage of contract spend, called Unified Support. There will now be three tiers of support called Core, Advanced, and Performance respectively. Oracle, IBM, and SAP have been using this model for a number of years whereby maintenance costs of an agreement are based on a percentage of the overall contract spend. This will have a profound impact across every type of organization regardless of industry.

The new Microsoft Unified Support model is still in beta phase, aiming for a global rollout by the end of Microsoft’s fiscal year 2019. Its aim is moving towards providing support for organizations adding cloud products to their Microsoft volume licensing agreements but maintains support for historical on-premises and legacy products. Prices could rise for current customers by up to 30%.

What to know when examining Unified Support and what it means for your organization:

• What is being used and how much of it
  • For many organizations, utilization of the number of hours purchased across support offerings varies significantly as well as the need for a Technical Account Manager. At renewals, historically these numbers can be re-adjusted. With the switch to a unified support model, bundled plans may force your hand into a higher offering tier that previously would have been less expensive under a dollar per hour format.
• Support offerings
  • Third-party unified support providers are slowly starting to offer services in the same space as a competitor to Microsoft Unified Support services. Capacity is currently a bottleneck, as providers look to scale up resources with demand. Third-party support providers are keeping a similar framework to the Premier Support services model, with a dollar amount per hour cost of support.
• Flexibility
  • The new Unified Support model limits the options that were previously available in a dollar per hour rate where hours could be reduced if desired. Organizations can currently still renew their Premier Support contract one final time before being mandated into switching over to the new Unified model. Over that time, there is the possibility of Microsoft refining this new model.
• Types of support
  • In the Premier Support model, to leverage a Microsoft engineer-led assessment, the organization had to allocate a certain number of hours to that initiative. In the new Unified model, this option is available for the Advanced and Performance support plans but at an extra charge for the Core support option. Online program support is unlimited, however, you will pay extra for an engineer at the core-based tier. At the Performance or Advanced tiers, there are some days built into the contract that may be used.
  • Online problem resolution support services are offered at an extra cost.
• Response time
  • As organizations move to the cloud, there will likely be increasing need for support.
    • With problems potentially occurring from an increased frequency of updates, or a proactive desire for support, the demand for services will likely increase, affecting support providers’ ability to resolve problems in a time-effective manner.
  • Premier Support response times are currently up to one hour for critical issues and two hours for anything else.
  • Under Unified Support, the highest tier of Performance Support reduces to a 30-minute SLA for critical issues.

Recommendations

Examine current usage patterns of Premier Support services closely and determine which aspects in particular are most important to the organization. Hours often go unused within organizations, or the contract has been renewed as is, because that is how it has been for the past number of years. Re-examine what services are still needed, and potentially renew your current Premier Support agreement for one last term, if possible, to maintain the similar flexibility and cost levels. Finally, begin examining third-party support providers for Microsoft Premier services.

Bottom Line

Examine your strategy around Microsoft Premier/Unified Support services, as many organizations will be caught by surprise with the changes that will be coming, potentially increasing spend by 30%.